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Sources: Cruise ship industry files suit over head tax

by Rebecca Palsha
Thursday, September 17, 2009

ANCHORAGE, Alaska -- It's been threatened for months and now sources say the cruise ship industry is ready to fight Alaska's $50 passenger head tax in court.

Several lawmakers Channel 2 spoke with Thursday say they've heard a lawsuit has been filed, or is about to be filed, on behalf of the cruise ship industry.

We've been unable to see the paperwork ourselves, but several sources close to this issue tell us that the lawsuit is imminent and just this past June a representative of Carnival Cruise told reporters the cruise industry's intention to file the litigation relatively soon.

"There has been a lot of criticism of it -- none of it valid, none of it has gone through," Chip Thoma with Responsible Cruising in Alaska said in June. "Every time they really try to major rollback it's been hopelessly defeated because the Legislature believes that the thing it's working."

Of the tax, $46 pays for infrastructure at Alaska ports that cruise ships use and $4 supports the Alaska Ocean Ranger program to prevent pollution of Alaska's water.

But the other side says that tax also steers the cruise industry out of the state.

"We are losing three ships -- from Princess, from Norwegian Cruise Line and from Royal Caribbean -- in addition to a change in pattern from Holland America, which means we literally will have a reduction of overall cruise ship capacity by 140,000 passengers or guests," said Ron Peck, the president and COO of the Alaska Travel Industry Association.

Everyone says a lawsuit was expected.

"Our member businesses have definitely seen tangible negative impacts on the visitor industry as a result of that cruise ship ballot initiative and the recession and other economic factors," Peck said.

"Not surprised at all about the threats and I basically view this as sort of a further attempt to bully the state Legislature into doing something that may not be the best policy for the State of Alaska," said Joe Geldhof, who co-sponsored the initiative.

"I hope they do sue because it will finally put this behind us. They have been threatening to sue for about 10 years," Thoma said.

Not all cruise ship companies are pulling out of Alaska. Disney just announced it will start coming into the state and Holland America says it will have a stop in Anchorage as part of a 14-day Alaska adventure cruise.

The governor's and attorney general's offices say they have not yet seen copies of the suit.

Contact Rebecca Palsha at rpalsha@ktuu.com